Sharp Board Meeting to Discuss Capital Increase, Forecast Change

By Robert Fenner -
Sep 17, 2013

Sharp Corp. (6753), which supplies Apple (AAPL)
Inc. with liquid-crystal displays, said its board is meeting
today to consider a public offering of shares and a capital
alliance to boost its balance sheet.

Directors will also discuss revisions to earnings forecasts,
with any decision to be announced promptly, the Osaka-based
company said in a statement today. Sharp may finalize plans to
raise 170 billion yen ($1.7 billion), Reuters reported, citing
unidentified people familiar with the matter.

Sharp has posted losses totaling 921 billion yen during the
past two financial years amid increased competition in LCDs and
flat-panel televisions. The company, which supplies screens for
Apple’s iPads and iPhones, has raised funds since last year by
selling minority stakes to Samsung Electronics Co. and Qualcomm
Inc. (QCOM)

The stock rose 2.2 percent to 378 yen as of 10:04 a.m. in
Tokyo. The shares have climbed 25 percent so far this year,
while Japan’s benchmark Topix index has gained 39 percent.

Sharp will raise 150 billion yen through a public share
offering and 20 billion yen from a third-party allotment,
Reuters said.

In March, Samsung agreed to buy about 3 percent of Sharp
for 10.4 billion yen. Later that month, the Suwon, South Korea-based maker of Galaxy smartphones said an offer to buy Sharp’s
photocopier business was rejected.

Sharp has 200 billion yen of convertible bonds maturing at
the end of this month, according to data compiled by Bloomberg.
Its debt is rated B+ by Standard & Poor’s, which is four levels
below investment grade.

Japan’s largest maker of LCDs is forecasting net income of
5 billion yen for the year to March 2014, its first annual
profit in three years, after job cuts. The company sold a stake
in its largest LCD plant to Taiwanese billionaire Terry Gou last
year to boost sales through his Foxconn Technology Group, the
world’s biggest contract manufacturer of electronics.